Use the following financial statements and additional information to prepare a statement of cash flows for the year ended December 31, 2020 using the indirect method. Kris Kringle, Inc. Balance Sheets At December 31 2020 2019 Assets: Cash $174,525 $65,200 Accounts receivable, net 52,850 56,750 Merchandise inventory 167,750 144,850 Prepaid expenses 16,080 12,680 Equipment 290,600 245,600 Accumulated depreciation-Equipment (80,600) (97,600) Total assets $621,205 $427,480 Liabilities: Accounts payable $55,270 $45,450 Income taxes payable 10,320 12,240 Notes payable (long term) 59,200 79,200 Total liabilities $124,790 $136,890 Equity: Common stock 200,000 150,000 Paid-in capital in excess of par 53,000 40,000 Retained earnings 243,415 100,590 Total equity $426,415 $290,590 Total liabilities and equity $621,205 $427,480 Kris Kringle, Inc. Income Statement For Year Ended December 31, 2020 Sales $488,000 Cost of goods sold $222,540 Depreciation expense 25,000 Other operating expenses 106,260 Interest expense 6,400 (360,200) Other gains (losses): Gain on sale of equipment 2,850 Income before taxes 130,650 Income taxes expense 30,525 Net income $100,125 Additional Information a. Cash dividends declared and paid were $55,000. b. New equipment is purchased for $150,000 cash. c. Received $49,550 cash for the sale of equipment. d. Issued new shares of stock receiving $157,000 cash.
Question 21
Use the following financial statements and additional information to prepare a statement of cash flows for the year ended December 31, 2020 using the indirect method.
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Kris Kringle, Inc. |
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2020 |
2019 |
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Assets: |
|
|
|
Cash |
$174,525 |
$65,200 |
|
|
52,850 |
56,750 |
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Merchandise inventory |
167,750 |
144,850 |
|
Prepaid expenses |
16,080 |
12,680 |
|
Equipment |
290,600 |
245,600 |
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Accumulated |
(80,600) |
(97,600) |
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Total assets |
$621,205 |
$427,480 |
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Liabilities: |
|
|
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Accounts payable |
$55,270 |
$45,450 |
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Income taxes payable |
10,320 |
12,240 |
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Notes payable (long term) |
59,200 |
79,200 |
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Total liabilities |
$124,790 |
$136,890 |
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Equity: |
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|
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Common stock |
200,000 |
150,000 |
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Paid-in capital in excess of par |
53,000 |
40,000 |
|
|
243,415 |
100,590 |
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Total equity |
$426,415 |
$290,590 |
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Total liabilities and equity |
$621,205 |
$427,480 |
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Kris Kringle, Inc. |
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Sales |
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$488,000 |
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Cost of goods sold |
$222,540 |
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Depreciation expense |
25,000 |
|
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Other operating expenses |
106,260 |
|
|
Interest expense |
6,400 |
(360,200) |
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Other gains (losses): |
|
|
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Gain on sale of equipment |
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2,850 |
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Income before taxes |
|
130,650 |
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Income taxes expense |
|
30,525 |
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Net income |
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$100,125 |
Additional Information
a. Cash dividends declared and paid were $55,000.
b. New equipment is purchased for $150,000 cash.
c. Received $49,550 cash for the sale of equipment.
d. Issued new shares of stock receiving $157,000 cash.
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